Best Small Business Ideas in the Philippines for 2020

Millions of people lost their jobs due to the COVID-19 pandemic of 2020, leaving them with no choice but to seek for new ways to earn money in order to survive.

Perhaps one of the most important things that this pandemic has taught us is that flexibility and adaptability are necessary in dealing with the “new normal”. A primary job just isn’t enough; in times of certainty where industries are being dismantled left and right, it is almost a requisite to have a side hustle at any given moment.

While it is true that starting a business during economic downturns is indeed risky- case in point, when the quarantine forced people to stretch up all their savings for months leaving a lot of people with less cash on hand, it is still POSSIBLE to start a small business even with little to no capital.

See post: How to Start a Business with No Money: A Simple Guide

Even when it’s seemingly all gloom and doom, there is always an opportunity even in the midst of a crisis. For the record, there is a surprising roster of companies and business in the Fortune 500 that were started during previous economic recessions- Airbnb, Apple, Netflix, Microsoft, etc.

Of course I’m not saying that it’s guaranteed that your business will be in the Fortune 500. But the point is that there is always a light at the end of the tunnel. There are always opportunities to be tapped, and all you have to do is start with a small business and be strategic about your plans.

Small Business Ideas in the Philippines for 2020:

What you need is Online Presence.

There’s a surging demand for ready-to-eat food and food deliveries in the Philippines as people are required to stay indoors. All you have to do is reach out to your customers via online presence.

It doesn’t have to be expensive. Of course you can opt to create a website via Shopify, but if you’re on a tight budget or just starting out, you can start selling via social media platforms like Facebook fan pages and Instagram.

Here are some examples of profitable food businesses that you can start:

1. Milk tea business

A milk tea business is indeed one of the most lucrative businesses in the food industry. You might argue that the competition is quite tough in the Philippine market; while it is true, there’s an increasing demand for milk teas as it capitalises on consumer’s cravings and it’s not going away anytime soon. Milk teas are highly versatile and you can easily mix and match different ingredients yourself to make an original concoction without having to shell out a large capital.

If you’re not franchising, hiring, renting out, the approximated capital required for the ingredients is around 5000-15000 Php.

2. Home cooked meals (Lutong ulam)

Online home cooked meal businesses are becoming more popular as well.

Even though people are more inclined to cook at home bc of the quarantine, it would still require for them to buy variety of ingredients in order to cook different dishes for breakfast, lunch and dinner. Grocery shopping would be such a hassle and buying different ingredients would be more expensive and wasteful.

To solve this problem and to give people more choices as to their food preferences, an entrepreneur can make a home cooked meal based business. You could delve into a sub-nice like “vegetarian home cook meals”, “keto home cooked meals”, “Korean home cooked meals”, or “Filipino home cooked meals.” The possibilities are endless.

You could also make a subscription based business out of this.

3. Online Bakery

An online bakery business idea is perfect even if you’re not a professional pastry chef and just loves to bake as a hobby. There will always be a demand for baked goods like cookies, brownies, bread, gourmet desserts, tarts, and cakes.

People won’t stop celebrating birthdays even if there’s a pandemic. Even if people are confined in their homes, they’ll find a way to send cakes for their special loved ones. You just have to have an online presence where they can order from a selection of baked goodies and have them delivered to their doorsteps.

Of course, one of the biggest challenges is delivering cakes. You’ll have to have a car or an SUV. Finding a reputable courier service that delivers cake and pastries can be quite a challenge too.

4. Merienda

In the Philippines, it’s almost customary for us to eat Meriendas/light-meals/snacks in the afternoons or even midnight. After all, it’s best to eat something while watching Netflix right?

An online merienda business can be quite profitable and the possibilities are almost endless.

One merienda business idea that is quite trending these days is Baked Sushis. It is almost similar with the California maki but it’s baked in casserole.

Another merienda business idea is pizza. You will have to compete with the giants like Pizza hut, Dominoes, Papa John’s and the others though; but if you target a different price point, or introduce new flavors, you will be able to stand out from the competition.

Other merienda business ideas are ramen noodle kits, korean food, chicken wings, etc.

5. Food supplier/retailer

An online one stop shop for food supplies, ingredients, etc. is proven to be very lucrative as well.

Grocery shopping can be such a hassle because of long lines. To make it easier for your customers, you can have their basic needs delivered straight to their doorsteps.

Millennials, on the other hand, aren’t particularly keen on going to markets. To bridge the gap, you can be a supplier or a retailer of poultry, meat, fruits, vegetables, etc.

Joining facebook wholesaler groups is where you can find good deals and discounts for supplies. In my opinion, choosing a niche and focusing on a few selective items could be cost-effective if you’re just starting out because you can get massive discounts by buying them in bulk. Your customers will also remember your business as their to-go-to shop.

Retail

Retail will never go away regardless of the current economic landscape. The concept of buy and sell is here to exist; it only just evolves.

The challenge, however, is picking the right selection of products that is suited for your target demographic. And of course, in choosing your products, you have to take into account the proper price point, and uniqueness of your product vs your competitors.

In times of economic crises, offering products that “bridge the gap” are very valuable. Here are some examples:

6. Bike retail and repair

During the COVID 19 crisis, the Philippine government limited the number of public utility vehicles that were allowed to operate.

Because of this problem, people resorted to riding bikes as a cost-efficient means of going to work. The demand for bicycles skyrocketed, and even those who didn’t know how to ride bikes had to learn.

This is very lucrative for bike retailers and repair shops.

7. Skincare retail and reselling

The beauty industry was proven to be recession proof during the previous economic downturns. For the year 2020 however, it wasn’t spared by the COVID 19 pandemic. Sales have tanked because consumer habits have changed dramatically. Because of the mandatory stay-at home rules and the rise of work from home setups, women spent less on make-ups, hair care products and stopped going to salons.

This isn’t to say that the beauty industry will remain to have a pessimistic outlook towards the last quarter of 2020 onwards. In fact, there’s a “gap” in the skincare industry that needs to be addressed.

An example would be the rising cases of people with pimple breakouts caused by prolonged wearing of masks. As a precautionary measure against the spread of the coronavirus, people almost from all over the world were required to wear masks. And as we all know, bacteria and oil can be trapped in our pores and even more so when we wear masks. As an entrepreneur you could help solve this problem by selling natural and fragrance free skin care products that caters specifically to this problem.

Another opportunity is becoming an online reseller of popular Filipino skincare brands. It’s always best to check the FDA website if those products have been approved for consumer use.

8. E-commerce marketplace

An e-commerce marketplace can be in the form of an online grocery store, an online fashion store, an online store that sells health kits, etc.

As already mentioned above, it’s such a hassle falling in line in grocery stores. Aside from ridiculously long lines, people are averse to going outside for fear of contracting the virus. The solution? E-commerce marketplaces.

Check out 8 Best Courier Services in the Philippines for Online Sellers and Merchants.

Your online store doesn’t have to have the most extensive variety of products. Choose from a small niche or expand from there. Or you could also opt to make it like an online “sari-sari” store.

If your budget is pretty tight, don’t worry. You don’t have to hire a professional programmer to build your e-commerce website. Shopify and Woocommerce can easily help you make your own online store in just minutes! For marketing, make facebook fan pages and an instagram account to link your store from there.

You can also become a Shopee or a Lazada seller. Just send an application via their website and submit their requirements.

Do you have any questions? Feel free to ask or write a comment down below!